Improved financial results seen at Stockton port next year

STOCKTON - Port officials said Monday they expected much stronger financial results in the coming fiscal year, beginning July 1, for two main reasons:

Reed Fujii

STOCKTON - Port officials said Monday they expected much stronger financial results in the coming fiscal year, beginning July 1, for two main reasons:

» They anticipate record-setting cargo volume, totaling 4.3 million metric tons, compared with the previous record set in 2006 of 3.6 million metric tons (a metric ton is 1,000 kilograms or just over 2,200 pounds).

» They hope to privatize the Marine Highway M-580 project, which fell far short of projections; it is expected to bring in only $1.1 million in revenues versus the original forecast of $15.1 million.

"We put a big bull's-eye up on a startup business with the M-580, and we didn't hit the target," Port Commissioner R. Jay Allen said during the commission's annual budget review Monday.

It was a "big miss," agreed fellow Commissioner Sylvester Aguilar.

The port has forged an agreement with Mediterranean Shipping Co. of Geneva to possibly take over the Marine Highway operation by Sept. 1.

As a result, Port Director Richard Aschieris assured the seven-member commission: "In the coming year, I think you will see the port returning to its core activities."

Stockton's inland port might actually exceed its cargo estimates, because it based its projection on interviews with regular customers and then trimmed 1.1 million metric tons from the total "just to be conservative," Aschieris said.

That conservative estimate would be a 61 percent gain from the nearly 2.7 million metric tons posted this year, largely due to a boom in coal shipments. Increased cargo should help boost revenues from terminal and warehousing operations by 12.4 percent to $24.9 million, officials said.

Total revenues should increase even more strongly - up more than one-third to $63.8 million next year, compared with an expected $47.5 million this year.

Much of the difference will come from capital contributions and grants totaling nearly $16 million in the coming year versus $4.5 million this year, associated with a number of major improvement projects, including construction of a new Navy Drive bridge to Rough and Ready Island and an improved Navy Drive rail underpass, as well as rail improvements on Rough and Ready Island and port road renovations.

Port officials expect net income of nearly $17.8 million in the 2014-15 fiscal year, compared with projected income of $2.1 million in the current year.

Commissioners approved the budget on a unanimous voice vote.

Prior to the late-afternoon meeting, a number of the commissioners and Aschieris stood on the Rough and Ready Island docks to celebrate the port's export of 2 million metric tons of bagged rice, mostly to Pacific Rim customers.

Since beginning in 2000, Aschieris said the rice trade has generated an estimate $45 million in wages and benefits in the Stockton area, mostly paid to workers receiving shipments in dock-side warehouses and then loading the rice onto ships.

Overall, including growing, milling, trucking and shipping operations, the port's bagged rice business has generated about $224 million in wages and benefits, Aschieris said.